Not wanting to be too much of a devils advocate here, but whilst I think you should take what you've heard seriously, you also need to be aware that there's also a chance that it's either exaggerated or not true.
I say this because we have experienced this with DD2 - in the past she has told friends awful lies about people, not only about people she doesn't know/hasn't met, but family members too, not just little lies but big ones involving physical harm. The friends have then gone to parents/teachers as they have been worried, and of course they have to take it seriously - not to the point of SS, but someday her lies could come to that.
Anyone with teenagers knows what their ability to expand a story is - I could come up with a myriad of stories from DD where normal parenting has been recounted to friends as 'dragon witch from hell parenting', and worse - they use their own actions as a reaction to something you haven't even done! For instance, DD2 once told her friends that we were forcing her to have packed lunch and checking she was eating it because we were concerned she had an eating problem...none of this was true, and the story came the day after she asked us if she could have packed lunch that week
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Equally, it could all be complete truth, you couldn't possibly know, but I have told people in the past and stand by it - if you are concerned about it, call SS, and either it will be proved right, or proved wrong - in some ways I wish someone would call SS about the lies DD2 pedals as I hate knowing there are people out there thinking she has a hard life! If I were in the same position I would report it, I couldn't imagine sitting on the knowledge and a child getting hurt.